MILLIONS of homeowners, commuters and students will not be reaping many benefits from the fall in the cost of living to its lowest level for 12 years. The consumer prices index (CPI) measure of inflation dropped from 1.3% in October to 1% in November due to cheaper fuel and intense supermarket competition. However, the retail prices index, which also includes housing costs, stands at 2%. Unfortunately, many bills and payments are often pegged to the higher RPI.
The inflation figures produced by the Office for National Statistics each month are based on a basket of goods and services as diverse as flavoured milk, a car wash, bird seed and DVD subscriptions. CPI is the official rate as it meets international standards. It is typically lower